Charitable IRA Extended for 2010 and 2011

The Charitable IRA Rollover, which allows tax-free distributions from an Individual Retirement Account (IRA) to a public charity, was extended for 2010 and 2011. This provision was included in the recently approved Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (H.R. 4853).

You can make eligible distributions in both 2010 and 2011. Because this legislation passed so late in the year, distributions for 2010 may be made until January 31, 2011.

What is the Charitable IRA Rollover?

If you are 70 1/2 years old, you are allowed to make a direct distribution of up to $100,000 to any public charity, school or church in the U.S., without having to pay income tax. There are a few key restrictions, however:

  • Donor Advised funds are ineligible to receive IRA rollover distributions.
  • Distributions are limited to up to $100,000 per calendar year
  • Contributions must be made directly to the Charity from the IRA

How Adirondack Foundation Can Help

Most donors' charitable IRA rollover gifts can be easily facilitated through their IRA plan administrator, such as a "lump sum" contribution to their alma mater, a favorite arts organization or a local social service agency. However, you may be looking for additional flexibility or anonymity that only ACT can provide.

  1. "Stretch Out" Payments Based On Your Time frame. While the IRA rollover to ACT must happen in 2010 or 2011, you can distribute the rollover amount to the charitable organizations of your choice over several months or years, thus "stretching" the IRA distribution to match your timing needs.
  2. Anonymity. Unlike regular IRA charitable rollover distributions, grants to charities from a fund at Adirondack Foundation may be made anonymously.
  3. Benefit More Than One Charitable Organization. You can establish a fund that will make distributions to pre-selected charities with one IRA charitable rollover gift.
  4. Establish a Permanent Legacy. You may wish to use this opportunity to establish or add to a permanent endowment fund to support your favorite charitable causes – forever.

For more information on the Charitable IRA Rollover contact Cali Brooks, at (518) 523-9904 or cali@adirondackfoundation.org.